2017 (3) TMI 725 - AT - Service Tax

Appeal allowed, refund claim for software development & business support upheld. Member found disallowance unjustified.

The appeal was allowed, and the impugned order disallowing the refund claim for specified services in software development and business support was set ... Refund claim - denial on the ground that input services do not have nexus with the output services provided by the appellant - Held that: - the Department has not issued a SCN proposing to reject the refund claim thereby the rejection has been unilaterally done by the Department without affording an opportunity to the appellant to put forward their case for establishing by necessary documents the eligibility of refund - the Tribunal have analysed the nexus/eligibility of refund in the appellant's own case for different period - the appellant is eligible for the refund - appeal allowed - decided in favor of appellant. Issues:Appeal against rejection of refund claim for input services in software development and business support services.Analysis:The appellant, engaged in Software Development Services and Business Support Services, filed a refund claim for a specific period. The claim was partially disallowed by the authorities citing lack of nexus between input services and output services provided. The appellant contended that the disallowed services, such as maintenance charges and convention services, should be eligible for refund based on case laws and previous Tribunal orders in their favor. The appellant also highlighted the absence of a show-cause notice, depriving them of a chance to present a proper defense.The learned consultant for the appellant argued for the refund eligibility of various services, presenting details and justifications for each service category mentioned in a tabulated form. The Air Travel Agent's Services, Commercial Training or Coaching Services, Convention Services, Insurance Auxiliary Services, Management, Maintenance or Repair Services, and Management or Business Consultant's services were all partially or fully disallowed in the refund claim. The appellant's consultant emphasized the Tribunal's previous favorable decisions in similar cases and the lack of a show-cause notice in the present case.In response, the learned AR reiterated the findings of the impugned order, supporting the disallowance of the refund claim for the specified services. After hearing both sides, the Member (Judicial) analyzed the details of the services provided by the appellant and the arguments presented. The Member noted the absence of a show-cause notice from the Department proposing the rejection of the refund claim. Relying on the Tribunal's previous judgments in the appellant's favor for similar cases, the Member held that the disallowance of the refund was unjustified. Consequently, the impugned order disallowing the refund for the specified services was set aside, declaring the appellant eligible for the refund. The appeal was allowed with any consequential reliefs that may apply.